Isabel Hilton (IH): Why did Infosys [Infosys Technologies Limited] adopt its green initiative?
Rohan Parikh (RP): Infosys is about a US$5-billion company and one of the biggest brand names in India today. We are considered a leader and we are the trend setters. Two years ago, we took stock of the last 25 years’ performance and we asked ourselves: what it will take to ensure that for the next 25 years our brand remains respected in the same manner? The second thing we asked was: what are the biggest challenges of the twenty-first century? There were two very clear answers: one is climate change, and the other is poverty alleviation.
We realised that unless we look at the social and economic growth of the community around us, wherever we are present, we will not continue to be respected. We have to contribute back. Where we need to be recognised as a trendsetter – being the best in the world – is in energy and resource consumption. Unless Infosys can demonstrate that we are at the cutting edge of energy and resource efficiency, we don’t have the right to talk at the policy level, the government level or anywhere else. If we don’t tackle it ourselves, we have no right to give advice to anybody else. We have to get our house in order first.
So we took on ambitious goals. On the energy and efficiency side, we said we must become carbon neutral, not only by buying renewable energy, but also in efficiency. In a country where 40% of the people do not have access to electricity, how can we waste? We want to be the most efficient in terms of consumption, and after that to source through renewables – so now we have a dedicated team working on this. We did our carbon footprint analysis and realised that 60% of our energy consumption goes on providing cooling comfort and lighting for our workforce; the remaining 35% is in computers. So green, high-performance buildings and improving the efficiency of our current stock is very important. We also add about 20,000 new employees each year, which demands about two to three million square feet of additional floor space a year, so the new stock should be very high performing.
The second area is water resources, which in India – with pollution and groundwater depletion – is very fragile. So, we need to become sustainable and not to impact negatively on the society around us, or to consume more than our share. Otherwise we will get business risk: people will migrate away from the area simply because there is no good quality water, and other water-related risks. We aim to become water-sustainable, to survive on rainwater and recycled water. If we can achieve that, especially in our new campuses, it will set the trend.
The third area is becoming a zero-waste company, including e-waste. The fourth area is bio-diversity, preserving our existing sites and promoting it. Our campuses are around 300 to 400 acres, and we are preserving and promoting native plants – like a Noah’s Ark of these species. We realise that we need each of our 100,000 employees to participate, then they will touch another 400,000 and we will start a chain reaction.
We came up with a sustainability report and as a result our competition came under peer pressure to publish sustainability reports. I am confident that next year there will more companies who will be doing that.
IH: There is a risk that companies see these activities as add-ons to a business, instead of part of core operations.
RP: We look at things from every angle: environmental, social and economic. Economically, we have done extremely well for 25 years. The question is: how do we become world leaders in other areas? We are a small team, but we have a lot of senior management attention – so we are very effective from that perspective.
IH: How do you make the business case for greening the company?
RP: Everything we do has a cost benefit. It was all wasted money, so the CEO is very happy. In every instance are saving money. We haven’t taken up unsustainable green activities yet, greening travel for instance, which would mean going beyond the campus and to create a sink or invest in activities that create negative carbon. We haven’t reached that point yet.
When we do that, it may not represent economic value – though we may be able to get a good return for us and for others. But at this point there are so many low-hanging fruit, which represent tremendous savings – everything we have touched has saved money.
IH: What did those savings consist of?
RP: Sustainability by design is our focus. We save electricity by becoming more efficient. We came up with new strategies for design, making buildings more efficient so we can save capital and running costs. In the design of new buildings, for instance, we were unnecessarily buying large equipment, which we reduced by correcting our design flaws, so we have saved about US$4 million in capital and operational costs.
IH: Many people say that Indian businesses are more proactive in reducing emissions than the Indian government. Do you have enough help from the government, in terms of policy and regulation?
RP: I think that some criticisms are valid and some are not. For the last 200 years, it has been companies and commercial organisations that have been emitting, not governments – so the buck starts with us. Amory Lovins said once that in the pre-industrial age, there were abundant resources and very few people, so we invented machines to make humans more productive. Now the situation is reversed: resources are scarce and humans have multiplied, so we need to focus on the productivity of resources, designing things to be recycled and not using virgin materials.
But it’s true that the government has to change some laws and regulations to make buying renewable energy more attractive. It is difficult, because there are no laws today in India that support that. It’s almost impossible to buy from a third party who wants to become a green utility, because the state electricity board can refuse to carry the power. So it’s almost impossible to become carbon neutral with a roadblock like that. The government is subsidising fossil fuels and not incentivising renewables, it’s difficult for a small company to buy green power and they don’t have the resources to set up or to manage their own energy farms. We are working with government and utilities at every level, explaining that we have no vested interest – but we want to buy. If they don’t make it easy for us, how can anyone else buy?
IH: And are they responsive?
RP: Everybody agrees it makes sense, but nobody wants to take responsibility. With this new government we have been trying to garner support to get them to change the Electricity Act so we don’t pay extra for buying green power. If that were to happen, I can guarantee you there would be huge investment. India has started. Infosys wrote the report for the minister of power on smart grids and things are happening. We are now talking to a couple of state governments on the road map for smart grids. It’s not far off with the solar task force coming in and investor-friendly incentives for renewables, but it needs support for distribution as well as manufacturing.
We have to work with others, rather than doing it individually.
IH: How do you persuade other companies to take the kind of action Infosys has?
RP: We all recognise we are part of the problem. All the responsible companies have recognised that they have to start contributing, and that if they don’t support action, they won’t attract the right talent – so most of them are doing some good stuff, but the scale is small for all of us, including ourselves. It will take a few years before the impacts become visible.
Rohan Parikh is head of sustainable development at Infosys
Isabel Hilton is editor of chinadialogue
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